The high school of my youth was Lowell HS in San Francisco. Lowell is the oldest public secondary school west of the Mississippi...established in 1856. Lowell's student body is drawn from the entire city. Since admission is selective and competitive, and given that San Francisco's general population was (is) significantly Asian-American...Lowell's student body had a high proportion of Asian-American students. This is even more true today, with close to 74% of Lowell's students claiming an Asian ethnic identity. I mention this all as a prelude to today's topic...Asian-Americans as a market segment for financial services.
In the first place, "Asian American" is a misnomer.The U.S. Census defines Asian as those having origins in any of the original peoples of the Far East, Southeast Asia or the Indian subcontinent, including Cambodia, China, Japan, Korea, Malaysia, Pakistan, Vietnam, Thailand, and the Philippine Islands. It also includes all Pacific Islanders. Each group carries their own distinct culture and language. For example, Chinese are the largest of the Asian American groups, and hail from four distinct regions...Taiwan, Hong Kong, the People's Republic of China, and Southeast Asia. There are many different regional dialects, but two major languages: Mandarin and Cantonese.
As a group, Asian Americans compose the most educated, wealthiest, and fastest growing of the U.S. population. Consider these facts:
- Although just 5% of the U.S. population now, the Census Bureau forecasts that the Asian American population will increase by 213% by 2050.
- Asian Americans now account for 5% of affluent U.S. households.
- Median income for Asian Americans is $52,018...compared to $42,409 for the general population.
- Asian Americans have the highest median home values at $199,300.
- 47% of Asian Americans age 25 or older have a bachelor's degree or higher.
- The Buying Power of the group is $344 billion, after-tax.
- 1 million of all Asian businesses are Asian-owned.
At the same time, there are significant cultural distinctions with the Asian community. For example, 67% of the population prefers to speak a language other than English. Asian Americans tend to get their news and information from ethnic media...and there are now more than 600 Asian media outlets in the U.S.
Asian Americans are more likely to have home mortgages, auto loans, and personal loans than the general market. They value savings, owning their own homes, and education. As a result, they are generally good candidates for mortgage lending, education savings plans, and IRAs. Generally, education, family and savings are three aspects of the culture that are very strong.
Although the Asian population is considered to be risk averse by some, 22% own individual stocks...the same percentage of non-Hispanic whites. Moreover, 75% of English-speaking Asian Americans use the Internet, and 53% have sought financial information online.
At the same time, there are some important cultural differences with regard to the topic of money and finances. For example, the Chinese prefer not to talk about death, and the mention of death, especially in a first meeting, is considered very disrespectful to elders.. Because the topic is taboo, Chinese-Americans prefer to refer to "life insurance" for the deceased as "life ASSURANCE" for the family that are alive.
Despite any differences, it probably makes the most sense to treat Asian Americans, first and foremost, as customers, in a non-stereotypical, non-pandering manner. Although, the group is, collectively, a very appealing market segment...any generalizations are false, including this one (to paraphrase Mark Twain.)
Hi Chris: Phoenix is STILL rising from the ashes. I joined Janney Montgomery Smith LLC. I like it very much and I'll tell you more about it tomorrow or Friday. How are you doing? I too had a wonderful experience running the stairs at Harvard Stadium a few years ago. I took the goal in small steps over a summer and what a great feeling it was to accomplish what I set out to do. Sort of what you were helping me with. one step at a time..let's reconnect and I still want to see if I can do something for you, as you were so nice to me and believed in me.
Sincerely,
Fran
Posted by: Fran Donlan | September 21, 2005 at 07:19 PM
Hi Chris: Phoenix is STILL rising from the ashes. I joined Janney Montgomery Smith LLC. I like it very much and I'll tell you more about it tomorrow or Friday. How are you doing? I too had a wonderful experience running the stairs at Harvard Stadium a few years ago. I took the goal in small steps over a summer and what a great feeling it was to accomplish what I set out to do. Sort of what you were helping me with. one step at a time..let's reconnect and I still want to see if I can do something for you, as you were so nice to me and believed in me.
Sincerely,
Fran
Posted by: Fran Donlan | September 21, 2005 at 07:19 PM